Exam (elaborations)
CPA Exam - BEC (1).
- Institution
- CISA: Domain #2, Part A: IT Governance
Exam of 14 pages for the course CISA: Domain #2, Part A: IT Governance at CISA: Domain #2, Part A: IT Governance (CPA Exam - BEC (1).)
[Show more]
Seller
Follow
Content preview
CPA Exam - BECQuestion - ANS-Answer
how often does an internal audit activity need to be assessed externally? - ANS-every five
years.
what are the primary themes associated with internal audit attribute standards - ANS-(1)
Purpose, Authority, and Responsibility; (2) Independence and Objectivity; (3) Proficiency and
Due Professional Care; and (4) Quality Assurance and Improvement Program.
the 7 primary themes of the performance standards: - ANS-(1) Managing the Internal Audit
Activity; (2) Nature of Work; (3) Engagement Planning; (4) Performing the Engagement; (5)
Communicating Results; (6) Monitoring Progress; and (7) Resolution of Senior Management's
Acceptance of Risks.
in a conventional graph, the 'intercept' is the point at which: - ANS-the dependent variable
intersects the Y axis, and where the independent variable has the lowest value, usually zero
elasticity of supply? - ANS-%change in quantity supplied/%change in price
what is elasticity of demand? - ANS-the % change in quantity is greater than the % change in
price
how do you prevent deflation? - ANS-you increase the money supply by lowering the reserve
requirement, or lowering interest rates which stimulates demand and increases the general
price level
what does an import quota do? - ANS-it restricts the quantity of a commodity that can be
brought into the country from foreign providers. The biggest beneficiary is the domestic
suppliers of the commodity.
3 generic strategies by Michael Porter? - ANS-cost leadership, differentiation, and focus
which framework is for gauging the attractiveness of the competitive environment of an
industry? - ANS-five forces
what analysis method is for evaluating a macro-environment? - ANS-PEST analysis: political,
economic, social, and technological characteristics
, what are the five forces? - ANS-1-threat of new competition entering the market2-threat of
substitute goods or services3-bargaining power of buyers of the industry good or
service4-bargaining power of suppliers of the inputs used in the industry5-intensity of rivalry
what does SWOT stand for? - ANS-strengths and weaknesses of the entity, and the
opportunities and threats faced by the entity
how is weighted avg cost of capital calculated? - ANS-the required rate of return on each source
of capital weighted by the proportion of total capital provided by each source and then those
amounts are summed.debt:30%x(10% 1-30% tax rate)=2.1%CS: 60%x12%= 7.2%PS:
10%x10%= 1%WACC= 10.3%
what is a compensating balance and how is the effective interest rate calculated? - ANS-an
amount the borrower has to maintain in an account with a lender.the effective int rate is the cost
of borrowing divided by the funds available for use.If the interest each year is 40,000 and the
only amount you can actually use is 400,000, then the effective rate is 10%.
how is the required rate of return calculated? - ANS-risk free rate + Beta(expected rate - risk
free rate)
basic approach to capitalize earnings to determine value of business? - ANS-annual earnings /
required rate of return.
what is a time series model? - ANS-models based on extrapolation of past data to predict a
future value
delphi method? - ANS-form of qualitative forecasting that involves consensus of a group of
experts using a multi-stage process to converge on a forecast.
diff in quantitative & qualitative forecasting? - ANS-quantitative is objective and rely on math and
calculations. qualitative are subjective and rely on judgement and opinion
what is the profitability index approach? - ANS-the relative economic ranking of projects by
taking into account the cost & net present value of projects
average accounting rate of return? - ANS-avg annual after tax net income / avg cost of
investment.the avg cost of investment is the beg book value + ending bv then divided by 2.
formula for calculating the profitability index of a project? - ANS-present value of annual after tax
cash flows / original cash invested in the project
NASDAQ requires all companies have audit committees composed entirely of: -
ANS-Independent directors who are also financially literate
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller lydiaomutho. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for CA$11.48. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
81113 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now